Lina Khan: Pakistani-American Lawyer Fighting Big Tech Monopolies

[Riaz Haq]

Pakistani-American Lina Khan is seen as the front-runner for appointment to the US Federal Trade  Commission (FTC) as a commissioner in the  Biden administration.  She is a Columbia University Law professor who specializes in anti-trust law.  

Lina's 2017 seminal paper entitled "Amazon's Anti-trust Paradox" broke new ground in the application of anti-trust law against powerful technology monopolies like Amazon, Apple, Facebook, Google and Twitter. Traditionally, the US anti-trust actions have been focused on keeping consumer prices low. This narrow focus has helped big technology companies companies like Amazon, with its low prices, or Google and Facebook with their “free” services, to avoid anti-trust scrutiny.   

Lina was born in London in 1989 to Pakistani parents who migrated to the United States when she was 11. She graduated from Williams College with a BA degree and then studied law at Yale University. She is now an associate professor at Columbia Law School in New York City. 

Anti-Trust Scholar Lina Khan

US tech companies are facing increasing scrutiny in Washington over their growing size and power.  In October 2019, an investigation by the House Judiciary Committee issued a 449-page report. It accused the big technology companies of charging high fees, forcing smaller customers into unfavorable contracts and of using "killer acquisitions" to constrain competitors. "To put it simply, companies that once were scrappy, underdog startups that challenged the status quo have become the kinds of monopolies we last saw in the era of oil barons and railroad tycoons," it said. The appointment of Lina Khan as FTC commissioner would send a clear signal to the US tech giants that the Biden administration means business. 

Lina Khan acknowledges the popularity of the convenience and the free services offered by the large technology giants like Amazon, Facebook and Google but she worries about the longer-term implications of their anti-competitive behavior. “As consumers, as users, we love these tech companies,” she said. “But as citizens, as workers, and as entrepreneurs, we recognize that their power is troubling. We need a new framework, a new vocabulary for how to assess and address their dominance", she told the New York Times.     

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[Riaz Haq]

Facebook Said to Consider Suing Apple Over App Store Practices
The social network has discussed an antitrust lawsuit against Apple, as tensions grow between the companies over how each treats consumer data.

https://www.nytimes.com/2021/01/28/technology/facebook-apple-app-st...


Facebook has considered filing an antitrust lawsuit against Apple, two people familiar with the deliberations said, a move that could escalate tensions between two of the world’s most powerful technology companies.

Facebook executives discussed accusing Apple of anticompetitive actions in its App Store, said the people, who spoke on the condition of anonymity because they were not authorized to speak publicly. The social network planned to say in a lawsuit that Apple gave preferential treatment to its own apps, while forcing restrictive rules onto third-party app developers like Facebook, the people said.

Facebook discussed filing the suit as recently as December, the people said. It is unclear if the company will move forward with any legal action.

The company declined to comment on a potential lawsuit. “We believe Apple is behaving anti-competitively by using their control of the App Store to benefit their bottom line at the expense of app developers and small businesses,” a spokeswoman said.

An Apple spokesman declined to comment. The Information earlier reported the possibility of a suit.

Tensions between Apple and Facebook have been growing for months, rooted in how the companies are diametrically opposed on how they make money. Apple, which has made privacy a key tenet, prefers that consumers pay for their internet experience, leaving less need for advertisers. In contrast, Facebook relies on data about its users to fuel its digital advertising business.


Over time, the Apple chief executive, Timothy D. Cook, and the Facebook chief executive, Mark Zuckerberg, have increasingly taken thinly veiled shots at each other to underline their distaste for the other’s philosophies on advertising, targeting and privacy.

The friction ratcheted up after Apple announced changes last year to its upcoming software for iPhones that could harm Facebook’s business. Apple said that it would clamp down on some data collection practices by developers and that it would allow iPhone owners to choose whether to allow companies to track them across different apps. That would likely hurt Facebook’s ability to collect user data to target ads.

Apple also recently began requiring developers to include privacy labels for their apps in the App Store, which detail an app’s information collection practices. In a recent analysis, The New York Times found that the privacy label for Facebook’s WhatsApp messaging app showed that it gathered far more information from people than another messaging app, Signal.

In response, Facebook has publicly pushed back against Apple. In December, Facebook created a website that slammed Apple’s moves as potentially harmful to small businesses. (It did not mention that the changes could hurt itself.) Facebook also took out full-page print ads in The New York Times, The Wall Street Journal and The Financial Times to declare that it was “standing up to Apple.”

[Riaz Haq]

A North Dakota bill that an Apple executive had warned “threatens to destroy iPhone as you know it” died in a vote on Tuesday.

https://www.nytimes.com/2021/02/16/business/north-dakota-app-store-...

Three-quarters of North Dakota’s 48 state senators voted against the bill, which sought to prohibit Apple and Google from forcing North Dakota companies to hand over a share of their app sales.

The bill targeted Apple’s and Google’s practices of charging a commission of up to 30 percent on many app sales. The companies brought in a combined $33 billion from those commissions last year, according to estimates from Sensor Tower, an app data firm.

Companies like Epic Games, Spotify and Match Group, along with some smaller app developers, have protested the commissions as artificially high, arguing that Apple and Google can only charge them because they are a duopoly and that app makers have little choice but to deal with them to reach customers. The two tech giants make the software that underpin nearly all of the world’s smartphones.


The bill attracted intense lobbying on both sides. Apple in particular feared it would set a dangerous precedent for its business, enabling app developers to avoid fees that have been crucial to its recent growth. Apple and its lobbyists warned that the bill could put North Dakota at risk of expensive lawsuits.

“We don’t want to put the state in a position where we need to spend our taxpayer dollars in litigation, because these are some very big companies,” Jerry Klein, a Republican state senator, said on Tuesday on the floor of the North Dakota Senate. “Let’s stay out of the courts.”

After the vote, Kyle Davison, the Republican state senator who introduced the bill, blamed its failure on the issue’s complexity and the opposition from Apple. “When banging heads with Apple you need to be able to match their intensity with resources, including lobbyists,” he said.

Critics and rivals of Apple and Google now turn their attention to other states. Arizona, Georgia and Massachusetts are considering similar legislation, and lobbyists are pushing for nearly identical bills in Minnesota and Wisconsin. The Coalition for App Fairness, a group of companies that oppose the app-store commissions, including Epic and Spotify, is leading the push for the bills.

Apple declined to comment and Google did not immediately respond to a request for comment.

[Riaz Haq]

What Jeff Bezos Hath Wrought
The Amazon founder prepares to step back just as Washington turns up the heat on the mega-retailer and cloud company.


https://www.nytimes.com/2021/02/08/opinion/bezos-jassy-amazon-antit...

If I had to guess who inspired Amazon’s founder, Jeff Bezos, to kick himself upstairs and appoint Andy Jassy, a deputy, as his successor as chief executive, I might wager that at least part of the blame can be laid on Lucy McBath, the freshman Georgia congresswoman, and her understated grilling of one of the world’s richest men at a July hearing held by the House antitrust subcommittee.

At the hearing, widely regarded as a watershed moment for America’s tech giants, most of the subcommittee members — and all the Democrats — had coalesced around a consensus: The business models of the four biggest tech companies depend on cementing and exploiting their statuses as gatekeepers to the internet, and scheming to bring down anyone who threatens their power to exact ever higher tolls on every minute we spend on the internet.

Only Mr. Bezos, however, had explicitly set out to become a ubiquitous “middleman” of all internet commerce. So most of the lawmakers pushed him to admit that he had systematically bought rivals and lost money selling goods and services below cost solely to destroy the competition, in violation of numerous federal laws that had long gone unenforced — or, as the antitrust scholar Lina Khan has put it, “charted the company’s growth by first drawing a map of antitrust laws, and then devising routes to smoothly bypass them.”

[Riaz Haq]

#Biden appoints Tim Wu anti-trust advisor. Wu is part of a broader movement for rethinking the #US approach to big #tech firms. Referred to as the Columbia School transformationalists, group includes #Pakistani-#American Columbia Law Professor Lina Khan https://qz.com/1980862/who-is-tim-wu-bidens-new-antitrust-advisor/

Tim Wu, a Columbia law professor who just became one of US president Joe Biden’s top antitrust advisors, thinks it’s time to crack down on the Big Tech. In his view, nothing less than the fate of democracy is at stake.

“The road to fascism and dictatorship is paved with failures of economic policy to serve the needs of the general public,” Wu wrote in The Curse of Bigness, a short book released in 2018 laying out his antitrust argument. Rather than focus on consumer welfare (read: low prices) as decades of monopoly theory has insisted, Wu argues that regulators should think more broadly about creating an economy that allows mom and pop shops and democratic government to thrive.

Wu’s philosophy is part of an ascendent school of antitrust theory originating in the writings of former Supreme Court justice Louis Brandeis, who saw anti-monopoly protections as a crucial check on the power of private industry during the early 20th-century. “The broad tenor of antitrust enforcement should be animated by a concern that too much concentrated economic power will translate into too much political power,” Wu writes, “and thereby threaten the Constitutional structure.”

Wu advocates breaking up Big Tech firms like Facebook, creating stricter merger review rules, and unleashing enforcement agencies to launch a slew of investigations and lawsuits that will dissuade dominant companies from bullying competitors. Taken together, his prescriptions amount to nothing less than a fundamental overhaul of contemporary American antitrust doctrine. His appointment to the National Economic Council, which has been cheered by progressives and booed by the tech industry, is an early signal that the Biden administration plans to get tough on tech.

The new school of antitrust targets Big Tech
Wu is part of a broader movement rethinking the US approach to antitrust enforcement. The group — sometimes referred to as the Columbia School, transformationalists, or the rather unwieldy “Neo-Brandeisians”—also includes Lina Khan, another Columbia law professor who earned much academic and media attention for her paper on “Amazon’s Antitrust Paradox” (and is a possible front-runner for Biden’s nomination to a seat on the Federal Trade Commission (FTC)).

[Riaz Haq]

Attorney Lina Khan, #Pakistani-#American progressive critic of big #tech, sworn in as #FTC chairperson. Khan’s confirmation signals a bipartisan desire to impose more regulations on Big Tech companies like #Facebook, #Amazon, Alphabet (#google) and #Apple. https://cnb.cx/3wsXcQ2

Progressive tech critic Lina Khan was sworn in as chair of the Federal Trade Commission on Tuesday, the agency said in a release.

News that Khan would lead the agency came just hours after she was confirmed by the Senate to serve as a commissioner. Sen. Amy Klobuchar, D-Minn., who leads the Senate Judiciary subcommittee on antitrust, first announced the new title at a hearing on Tuesday afternoon.

The Senate approved Khan’s nomination as a commissioner earlier in the day in a 69-28 vote.

The promotion puts the direction of the FTC in the hands of the young academic who helped launch a reckoning amongst antitrust scholars and enforcers. At 32, she was already the youngest commissioner ever confirmed to the agency, let alone to lead it. The Senate approved her nomination earlier in the day in a 69-28 vote.

As chair, Khan will have the ability to steer the direction of the agency to a greater extent than she would as a commissioner. That makes the announcement a significant statement on President Joe Biden’s intended direction for the commission, suggesting he wants to see a progressive agenda.

Khan will take over the helm from Acting Chair and Democrat Rebecca Kelly Slaughter, who has led the commission under Biden’s presidency. Biden is expected to name a third commissioner to succeed Democrat Rohit Chopra, whom he has nominated to lead the Consumer Financial Protection Bureau. The FTC is made up of five commissioners who vote on enforcement matters, with no more than three coming from the same party.

Khan’s progressive resume
Khan’s confirmation signals a bipartisan desire to impose more regulations on Big Tech companies like Facebook, Amazon, Alphabet and Apple. She received the support of several Republicans, including Commerce Committee Ranking Member Roger Wicker, R-Miss., who participated in her confirmation hearing.

Still, others like Sen. Mike Lee, R-Utah, the top Republican on the Senate Judiciary subcommittee on antitrust, opposed her confirmation. Lee has tended to be cautious about certain types of regulation despite concerns about tech companies’ influence and previously expressed apprehension about Khan’s experience.

Khan became a well-known figure in antitrust circles after writing “Amazon’s Antitrust Paradox” for the Yale Law Review in 2017, while a student at the university. The paper made the case for using a different framework for evaluating competitive harm than the popular consumer welfare standard. That standard essentially says that antitrust law violations can be determined based on harm to consumers, which is often measured based on prices.

But Khan argued that standard could miss significant competitive harm in the modern economy, such as predatory pricing that lowers consumer prices in the short term but allows a company that can afford it to quickly gain market share. She also argued that both owning and selling on a marketplace, like Amazon does, could allow a business to exploit information across their ecosystem to undercut the competition.

In the years since, Khan has become a recognized name among those in the field and a noted figure among progressives eager to see more expansive enforcement of antitrust laws. She participated in the House Judiciary subcommittee on antitrust investigation into Amazon, Apple, Facebook and Google, helping to compile the report from Democratic staff that found each held monopoly power.

The report recommended legislative reforms to reinvigorate competition in digital markets, which informed several recent proposals introduced by subcommittee members last week. Khan specifically worked on the Google section of the Democratic report. The company has since been sued on antitrust grounds by the Department of Justice and several states.

[Riaz Haq]

Lina Khan Is Taking on the World’s Biggest Tech Companies—and Losing
FTC chair’s court loss against Microsoft marks another setback in her fight to block mergers

https://www.wsj.com/articles/lina-khan-is-taking-on-the-worlds-bigg...

WASHINGTON—Federal Trade Commission Chair Lina Khan is taking on the world’s biggest technology companies—and losing.

Khan failed Tuesday in her latest effort to block a big-tech deal when a federal judge denied her agency’s bid to block Microsoft MSFT 1.42%increase; green up pointing triangle from closing its purchase of videogame publisher Activision Blizzard ATVI -1.09%decrease; red down pointing triangle. The FTC suffered a similar setback earlier this year when it tried to thwart Meta Platforms’ purchase of a virtual-reality gaming company.

Khan, who gained prominence as a critic of Amazon.com, entered office in 2021 vowing to stiffen antitrust enforcement. Past enforcers were too cautious about bringing tough cases, she has said, and failed to confront the rise of companies such as Facebook owner Meta that gained monopoly-like power in digital industries, she said.

“I’m certainly not someone who thinks success is marked by a 100% court record,” Khan said last year in remarks at the University of Chicago. “If you just never bring those hard cases, I think there is severe cost to that, that can lead to stagnation and stasis.”

Khan is set to testify Thursday before the House Judiciary Committee, whose Republican leadership is investigating her agency’s oversight of Twitter and her adherence to federal ethics rules. Republicans say the FTC is harassing Twitter over data-security practices and because Khan and other progressives unhappy with Elon Musk’s acquisition of the company.

Khan is also expected to be grilled on her antitrust record, including the case against Microsoft, and her decisions to not recuse herself from cases involving Amazon and Facebook owner Meta, both companies she publicly criticized.

Under the Biden administration, antitrust agencies have challenged more mergers than in previous years, including some that historically the government wouldn’t have tried to block. Microsoft and Activision aren’t head-to-head competitors, making the case against the deal less straightforward and more dependent on the FTC’s prediction that the combined company would abuse its power to hurt competition in the future.

In her opinion issued Tuesday, U.S. District Judge Jacqueline Scott Corley wrote that the FTC failed to show evidence backing up its claim that Microsoft was likely to withhold Activision’s blockbuster games from competitors such as Sony. The judge found instead that Microsoft had made commitments to share Activision’s content, which would expand consumers’ access to its biggest game franchise, Call of Duty.

Douglas Farrar, an FTC spokesman, said the merger posed a “clear threat” to competition and suggested the agency could soon announce an appeal. “In the coming days we’ll be announcing our next step to continue our fight to preserve competition and protect consumers,” he said.

Antitrust attorneys say the FTC’s case against Microsoft resembles an earlier attempt to block a gargantuan media deal: AT&T’s acquisition of Time Warner.

Both cases were examples of vertical mergers, a type of deal that courts generally regard as beneficial to consumers. When a vertical deal looked problematic, the government often sought a company’s commitment to maintain the status quo regarding competition. The Justice Department’s 2017 lawsuit to block AT&T-Time Warner’s deal was the first litigated vertical-merger challenge in 40 years.

Both cases also involved claims that the buyer would harm competition by making must-have entertainment exclusive to its own platform or devices. That didn’t work for the Justice Department, which lost the A&T case at a district court and on appeal.